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RESTRUCTURING

Saab slapped with debt claim over worker pay

Saab Automobile has been hit with a payment demand from the administrative board of Västra Götaland county, which lent the troubled automaker hundreds of millions of kronor to ensure employees' salaries during restructuring.

The county administrative board has ordered Saab to repay 110.7 million kronor ($16.2 million) by December 14th, Sveriges Television (SVT) reports.

The money was lent by the county to guarantee that Saab employees were paid in the first months following Saab’s bankruptcy filing in February of this year.

Altogether, Västra Götaland lent Saab 305.5 million kronor in salary guarantees, excluding social fees.

According to the county, the amount it now wants repaid isn’t covered by Saab’s debt reduction agreement, which mandates that creditors write down 75 percent of money they are owed by Saab.

If Saab doesn’t repay the money, Västra Götaland plans to to have the Swedish Enforcement Agency (Kronofogden) force the automaker to cough up the cash.

But Saab has said it doesn’t accept the county’s demands, believing that the salary guarantees are in fact included in the debt reduction accord.

“It may be that we go to court to try to case,” Saab spokesperson Eric Geers told the TT news agency.

During the entire six month restructuring process, Saab and the state have had different views about the salary guarantees and repayment.

According to Geers, the company hasn’t yet decided how it will proceed.

“But we are still of the opinion that it’s not right to take out one part of the guarantee and judge it in a different way than the others,” he said.

The county administrative board is equally decided, claiming that salary guarantees for the first months is payment for work after the start of the restructuring process, which means it is a new debt and hence not covered by the agreement.

In addition, authorities claim there is no way to appeal the matter.

“It’s not a decision that can be appealed; it’s a legal requirement,” Christina Danielsson, the head of the Västra Götaland county board’s economic division, told TT.

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RESTRUCTURING

Volvo announces major restructuring plan

Sweden's Volvo Group, the world's second biggest lorry manufacturer, announced Tuesday a 5 billion kronor ($780 million) restructuring plan over two years.

Volvo announces major restructuring plan

“The programme encompasses both reduction of white collar employees and consultants and efficiency enhancements in the global industrial system,” the company wrote in a statement, without indicating the number of jobs affected.

The Volvo Group, which also makes buses, construction equipment and engines, indicated that the restructuring would mainly concern its lorry business.

The company added that most of the changes “are expected to impact operating income during 2014”, creating savings in the region of 4 billion kronor annually “with full effect achieved by the end of 2015”.

RELATED STORIES: See a video of Volvo’s latest high-flying stunt

Volvo has reported disappointing results during the last year and a net loss in the first quarter of 2013, but posted a second quarter profit of 72.8 billion kronor – a 25-percent increase compared to the “weak start” to 2013.

In January the group announced an alliance with Chinese manufacturer Dongfeng aimed at challenging German lorry maker Daimler for the world’s top place.

The Volvo Group employs 112,000 worldwide, including 16,000 consultants and temporary workers.

AFP/The Local/og

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